Finance divisions that fail to go digital risk being reduced to an efficiency-first support role.

According to a new whitepaper by Oliver Wyman, by redefining its value contribution and self-perception, finance can seize the opportunities that digitalization offers to develop into a digital driver that shapes the digital landscape of the entire organization.

However, this is easier said than done.

While financial workflows and systems are primarily data-driven and structured, the nuances involved in terms of regulations, industry norms, and even accounting practices make it hard to plug analytics or intelligence into systems without a fair degree of customization.

As a result, CFOs need to be careful when drafting a strategy to help bring digital solutions into the fold — in a way that reduces costs and improves efficiencies, while also elevating the team to an enterprise-wide advisory role.

In order to help leaders in the finance function kick-off the change, Oliver Wyman consultants Philipp Andres, Thomas Fritz, Christian Lattwein, and Jörg Stäglich offer four guiding principles:

# 1 | Communicate a vision

“Finance executives should form a clear view of their role and the business activities of their teams in one, five, and 10 years. This vision should be transparent to all involved to ensure alignment with the strategy.”

At first glance, this seems like Change Management 101 — but it’s something many business leaders tend to forget to do especially in the initial phases where the organization is forming its vision for the future.

In order to get the most out of the function, CFOs must communicate clearly so that finance professionals may prepare themselves to support that vision by adopting the right mindset and picking up the right skills.

# 2 | Wind up the flywheel

“All-encompassing big pushes are likely to disappoint in their outcome. Experience has shown that starting small, with pilots, and growing successful pilot projects into digital products is the better way forward.”

According to the consultants, CFOs tend to get more traction with digital transformation projects when they launch pilot projects and then scale those up across the entire division.

In India, for example, ICICI Bank has deployed about 750 RPA bots that handle close to 2 million transactions per day.

The RPA bots have been developed in-house and scaled up for use across different operations including retail, wholesale banking, forex, treasury, agro and international operations.

Finance teams within organizations can follow suit, starting small and creating their own success stories before scaling up across the function.

# 3 | Empower your people

“Digital transformers grow when they are given legroom for maneuver and headspace to think. Self-organizing, agile scrum teams are a proven method to start the journey.

“This requires senior executive buy-in, clear communication from above, and a dedicated product owner that manages expectations and workloads to build an innovative and motivated modern workforce.”

In many cases, finance professionals also need additional training — but the investment goes a long way as existing knowledge coupled with new (tech) skills can help create useful dashboards and apps via low-code platforms and automations via do-it-yourself RPA ecosystems.

# 4 | Never lose sight of the business case

“Don’t be afraid to tackle real business problems. Failure and learning along the way is expected and should not deter from further progress.”

While CFOs are expected to accelerate their journey to digital, it’s important to keep in mind that failure is part and parcel of any transformation program.

So long as the finance function is focused on evolving into a data-driven unit that can provide insightful advice to other teams within the organization, failures should neither deter not slow down its digital agenda.